If you read the National Edible Oil Policy, The focus is primarily to reduce the dependency on Edible Oil Imports. Patanjali intends to become the largest Palm Oil plantation company in India and thereby the largest Palm Oil trader/seller. They have been allocated 6 lac hectares of land. They have started their new project in Arunachal Pradesh on roughly about 38000 hectares
(Patanjali Foods has committed itself to Government’s NMEO-OP program and plant to undertake large-scale cultivation of oil palm plantations on 5 lakh ha area in India; out of which 3.2 lakh hectare area will be in North East region. Patanjali’s NE Oil Palm Program will immensely benefit the state’s economy for over the next 30 years, key benefits include: avg annual production of around 7.5 lakh MT palm oil, saving of about Rs. 10,500 crores of forex outgo annually and employment generation for nearly 5.8 lakh persons)
They are targeting 7.5 lakh tone in 30 years, which translates to roughly 1.25 lakh tonnes in 5 years if everything goes as planned. The share of palm oil in the overall business will keep on increasing and hence i believe this will remain an essential commodity business with an FMCG tag name. THe other FMCG products will definitely bring value to the business however it remains to be seen how they scale the FMCG business and if it can become a big share in Patanjali Foods.
Even if they reach their target of 7.5 lakh tonnes in 30 years, they will only be able to fulfill 10% of the total current Palm OIl Imports. This opportunity is huge if they can scale it up and deliver.